Prudential Financial, Warburg Pincus launch Prismic Life Reinsurance with $1bn initial investment

Prudential Financial, Inc. (NYSE: PRU) and Warburg Pincus have announced the formation of Prismic Life Reinsurance, Ltd., a Class E Bermuda-based reinsurance company. The venture commences with an initial equity investment of $1 billion, with Prudential and Warburg Pincus owning 20% and 15% respectively.

Prudential’s Reinsurance Plans with Prismic Life Reinsurance

Prudential Financial aims to reinsure a block of structured settlement annuity contracts with reserves approximated at $10 billion through Prismic Life Reinsurance, subject to regulatory approvals. The reinsurance arrangement will not alter Prudential’s obligations to the annuity holders; instead, Prudential plans for Prismic to be a long-term reinsurance partner.

Expert Views on the Launch

Charles Lowrey, chairman and CEO of Prudential Financial, Inc., says, “This unique reinsurance platform will play an important role in our vision to be a global leader in expanding access to investing, insurance, and retirement security for people around the world.” Chip Kaye, CEO of Warburg Pincus, comments, “Warburg Pincus is thrilled to enter into this strategic partnership with Prudential in the creation of Prismic.”

Investment and Board Composition

The venture is backed by a group of global investors alongside Prudential and Warburg Pincus. The board of Prismic Life Reinsurance will include two independent directors and one director nominated by each of Prudential, Warburg Pincus, and the group of investors.

Asset Management Strategy

PGIM and Warburg Pincus will provide asset management services to Prismic Life Reinsurance. The reinsurance firm will utilize PGIM’s and Warburg Pincus’ global investment management capabilities, including public fixed income, private credit, and real estate.

Leadership and Future Ambitions

Amy Kessler, with 30 years of experience in the financial services industry, will serve as Prismic Life Reinsurance CEO. The platform aims to deliver an end-to-end ecosystem of liability origination, asset-liability management, and asset management. With this venture, Prudential aims to provide more people access to its life and annuity products through expanded reinsurance capacity.

Representation on Prismic Life Reinsurance Board

Nandini Mongia, president of Prudential Financial’s Open Architecture Solutions, and Mike Thompson, managing director at Warburg Pincus, will represent their respective companies on the board of Prismic Life Reinsurance.